REPORT ON COMBINED HELICOPTER BORNE MAGNETIC, ELECTROMAGNETIC AND VLF SURVEYS MINING CLAIMS , , AND

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1 42AUSWTO81 PROSSER 010 REPORT ON COMBINED HELICOPTER BORNE MAGNETIC, ELECTROMAGNETIC AND VLF SURVEYS MINING CLAIMS , , AND NORTH HALF LOT 5, CONCESSION V, PROSSER TOWNSHIP PORCUPINE MINING DIVISION, ONTARIO N.T.S. 42A/14 MARCH 17,1987 R. STEWART

2 INTRODUCTION This report presents the data and an interpretation for combined magnetic, electromagnetic and VLF airborne surveys carried out between January 3 and January 10,1987 over mining claims , , and located in the north half Lot 5, Concession V, Prosser Township. Technical details regarding the survey are discussed further in sections from George Podolsky's technical report given in Appendix A. PREVIOUS WORK The only assessment work recorded by previous operators on these 4 claims were 2 diamond drill holes drilled for Inco in Total drilling amounted to metres. Two conductive zones were tested by this drilling but no mineralization of economic significance was reported.(inco,1964) Current work filed for assessment includes 3 reverse circulation overburden holes drilled in 1986.(Alcock,1987) SURVEY DATA PRESENTATION Figure l is a tracing of the flight paths near the 4 claims. "The flight path map was derived from the Mini-Ranger radar positioning system. The distance from the helicopter to two established reference locations was measured several times per second and the position of the helicopter calculated by triangulation. It is estimated that the flight path is generally accurate to about 10 metres with respect to the topographic detail of the base map.* (Podolsky,1987) Figure 2 is a tracing of the contoured total field magnetic results near the 4 claims. "The aeromagnetic data were corrected for diurnal variations by adjustment with the digitally recorded base station magnetic values. No correction for regional variation was applied. The corrected profile data were interpolated onto a regular grid at a 25 metre true scale interval using a cubic spline technique. The grid provided the basis for threading the presented contours at a 2 nanotesla interval." (Podolsky,1987) Figures 3,4 and 5 are tracings of the electromagnetic profiles near the 4 claims. The figures illustrate filtered and levelled data and interpreted anomalies for the 3 different coil configurations. In this interpretation, anomalies were selected by the author from inphase peaks. "The electromagnetic data were recorded digitally at a

3 (ample rate of 10 per second with a time constant of 0.1 seconds., A two stage digital filtering process was carried out to reject major sferic events and to reduce system noise. Local sferic activity can produce sharp, large amplitude events that cannot be removed by conventional filtering procedures. Smoothing or stacking will reduce their amplitude but leave a broader residual response that can be confused with geological phenomena. To avoid this possibility, a computer algorithm searches out and rejects the major sferic events. The signal to noise ratio was further enhanced by the application of a low pass digital filter. It has zero phase shift which prevents any lag or peak displacement from occurring, and it suppresses only variations with a wavelength less than about 0.25 seconds. This low effective time constant permits maximum profile shape resolution.. Following the filtering process, a base level correction was made. The correction applied is a linear function of time that ensures the corrected amplitude of the various inphase and quadrature components is zero when no conductive or permeable source is present." (Podolsky,1987) Figure 6 is a tracing of contoured VLF-EM total field data near the 4 claims. This data was compiled from the VLF-EM signals from NSS, Annapolis Maryland and NAA, Cutler Maine broadcasting at 21.4 khz and 24.0 khz respectively. (Podolsky,1987) INTERPRETATION MAGNETICS The magnetic data from the high sensitivity cesium magnetometer provided virtually a continuous magnetic reading when recording at two-tenth second intervals. The system is also noise free for all practical purposes. The sensitivity of 0.1 nt allows for the mapping of very small inflections in the magnetic field, resulting in a contour map that is comparable in quality to ground data. Both the fine and coarse magnetic traces were recorded on the magnetic charts." Podolsky,1987) The Total Field Magnetic Contour Map, Figure 2, shows two east-northeasterly trending magnetic highs on the claim group. The stronger (190 nt) magnetic high occurs in mining claim , the other mag high is near the southeast corner of the claim block. Local magnetic background is taken to be nt. Electromagnetic anomalies are found along the flanks of these magnetic highs. The magnetic variations are mainly attributed to differences in magnetic susceptibility between different types of mafic volcanics. ELECTROMAGNETICS Anomalies were picked off the high and low frequency coaxial electromagnetic profiles through a line-by-line examination of inphase

4 peaks. A best fit conductor axis was then drawn through the resultant anomalies (Figures 3 and 4). Coaxial EM anomaly trends were in part verified by a comparison with coplanar EM responses (Figure 5). Four anomalous EM zones labelled A,6,C and D were located near the claim block. Anomaly A is a weak bedrock conductor that strikes east-west along the north boundary of the claim block. It occurs on the northern flank of the magnetic high. It may be related to graphitic zones within a regional shear zone. Anomaly 6 is very weak conductor with minimal coaxial response and almost nil coplanar response. It is not considered to be a bedrock conductor. Anomaly Cis a weak to moderate bedrock conductor that strikes east-west across the claim block. It occurs in the magnetic low between the two magnetic highs. Inco"s drilling shows this anomaly is caused by graphitic cherts and a thin pyrite zone occurring within mafic volcanics. Anomaly D is a moderate bedrock conductor that strikes east-west across most of the claim block. It is also in the magnetic low between the two magnetic highs. Inco drilling shows this anomaly is caused by a thin graphite/graphitic chert zone within mafic volcanics. VLF-EM TOTAL FIELD The VLF responses contoured in Figure 6 are characteristic of a thick, uniformly conductive overburden, that is they are relatively featureless with any discernible trends falling along the direction of the VLF transmitter station being read (i.e., southeast). (Podolsky,1987). CONCLUSIONS Three bedrock conductors were located along the flanks of magnetic highs. Previously drilling in 1964 by Inco found graphitic cherts with minor pyrite to be the conductor in the two most conductive zones. R. STEWART

5 (g 1CM CM 1CM O CO O S O to fo PJ Q ir) ro CM o s(m S fc CON V 1 M '/ CON O N '/2 CON CON LOT LOT LOT KIDD CREEK Exploration Oivition M l NES LTD. PROSSER 54 NE PROSSER Twp. Timmins, ONTARIO FLIGHT PATHS FIGURE 1 SCALE: : 10,000 Drown: DEL Project N o '8132 Doto: Stewort 001*^28/02/87

6 o o o K) W (\j M N O O O Q O 8 eh S! N w fi MN * in j; eg M n ft - 10 W W s ^ CON v i CON V M V, CON V S Va CON V LOT 6 LOT 6 LOT 4 AEM ANOMALY AXES AtRODAT AIRBORNE SURVEY 1886 / CONTOUR INTERVAL* 10 nt KIDD CREEK MINES LTD. Exploration Division Timmins, ONTARIO PROSSER 54 NE PROSSER Twp. MAGNETOMETER (TOTAL FIELD) FIGURE 2 SCALE- 10,000 Drown: Q EL PfO tct M* ' Oolo' Stiwort Dot*' 28/02/ST

7 fj O O 5 S (M W 8 t gft (M N o o o o o 0} S (0 in w f*1 K) rt K) io fj w rj CM cj S /2 CON V N '/2 CON V N V2 CON V CON V LOT * LOT S LOT 4 EM SCALE = 4 ppmxmm AEM ANOMALY AXES FIGURE 3 AERODAT AIRBORNE SURVEY 1986 f N-PHASE j 46OO Hi Cooxiol KIDD CREEK MINES LTD. ExplofOtioo D M*lon Timmini, ONTARIO PROSSER 54 NE PROSSER Twp. E M PROFlLES QUADRATURE ; 46OO Hi Cooxiol SCALE' l ' lo.ooo Drown; DEL Project N c '8132 Doto' Stewort Dot* : 28/O2/87

8 J S /2 CON V l N '/9 CON V N Vo CON CON LOT 6 LOT LOT EM SCALE a 4 ppnymm AEM ANOMALY AXES FIGURE 4 AERODAT AIRBORNE SURVEY 1986 l ln-phase i 935 Hi Cooxiol KIDD CREEK MINES LTD. Exploration Division Timmin*. ONTARIO PROSSER 54 NE PROSSER Twp. E M PROFILES -QUADRATURE i 9S5 Hi Cooxiol SCALE: l : 10,000 Drown: DEL Project N o :8I32 Dolo: Sttwort Dote: 28 / 02/87

9 o o o 9 st ; ci fi tvi 8 g g S s S a s fi s s CON V l M ife CON V W V, CON V *^i C ON v LOT 6 LOT * LOT 4 EM SCALE * I6ppnyr mm FIGURE 5 AERODAT AIRBORNE SURVEY 198* t 1 *07 IN-PHASE i 4178 Hi Coplonof KIDD CREEK MINES LTD. Exploration OMvlon Timmins, ONTARIO PROSSER 54 NE PROSSER Twp. E M PROFlLES QUADRATURE -, 4175 Hi Cop loner SCALE' 10,000 Drown i OC t Project N* '8)52 l Ooto' Sttwort Doll* 28/02/97

10 * * ft r. S w N-N o o o o N (D ifi S 10 to io ft M M CJ (W S Vf CON V l N V, CON V tt Vt CON V S V2 CON LOT e LOT LOT 4 CONTOUR INTERVALS - AEROOAT AIRBORNE SURVEY 19*6 X 19*7 KIDD CREEK MINES LTD. Exploration OMtlon Timmint, ONTARIO PROSSER 54 NE PROSSER Twp. V L F CONTOURS l FIGURE 6 SCALE' 10,000 Drown: O E C IProjte! N c '8132 Z Doto* SttWOft Ootf. 28/02/67

11 REFERENCES CITED Alcock,J.A.;1987 Report on Reverse Circulation Overburden Drilling Prosser Township. Assessment report filed by Kidd Creek Mines Ltd. for claims , , and February,1987. Inco;1964; Diamond Drilling Logs for Holes and 26633, Prosser Township. Assessment report T-924 filed by Inco. Podolsky,G.;1987; Report on Combined Helicopter Borne Magnetic, Electromagnetic and VLF Survey, Prosser Township, Porcupine Mining Division. Aerodat Limited. March 11,1987.

12 APPENDIX A SELECTED SECTIONS FROM G. PODOLSKY'S REPORT

13 REPORT ON COMBINED HELICOPTER BORNE MAGNETIC, ELECTROMAGNETIC AND VLF SURVEY PROSSER TOWNSHIP PROJECT PORCUPINE MINING DISTRICT by AERODAT LIMITED March 11, 1987 G. Podolsky P. Eng.

14 INTRODUCTION This report describes an airborne geophysical survey carried out on behalf of Kidd Creek Mines Ltd. by Aerodat Limited. Equipment operated included a three frequency electromagnetic system, a high sensitivity cesium vapour magnetometer, a two frequency VLF-EM system, a film tracking camera, an altimeter and an electronic positioning system. Electromagnetic, magnetic and altimeter data were recorded both in digital and anolog form. Positioning data were stored in digital form and recorded on film as well as being marked on the flight path mosaic by the operator while in flight. The survey data, comprising a block of ground in the Porcupine Mining District of north eastern Ontario and situated about 30 kilometres north of Timmins, was flown during the period of January 3rd to 9th, Four flights were required to complete the survey with flight lines oriented at an Azimuth of 000 degrees and flown at a nominal spacing of 100 metres. Coverage and data quality were considered to be well within the specifications described in the contract. The purpose of the survey was to record airborne geophysical data over and around ground that is of interest to Kidd Creek Mines Ltd. A total of 510 kilometres of the recorded data were conpiled in map form and are presented as part of this report according to specifications outlined by Kidd Creek Mines Ltd.

15 SURVEY AREA LOCATION The survey area is depicted on the index map shown below. It is centred at Latitude 48 degrees 46.5 minutes north, Longitude 81 degrees 16 minutes west, approximately 30 kilometres north of the town of Timmins in north eastern Ontario (NTS Reference Map No. 42 A/14) occupying the north half of Prosser township. The area is accessed by road and bush trail off Ontario highway 1655 or by helicopter out of Timmins airport, approximately 25 kilometres to the south west.

16 AIRCRAFT AND EQUIPMENT Aircraft An Aerospatiale A-Star 350D helicopter, (C-GRGK), owned and operated by Lakeland Helicopters Limited, was used for the survey. Installation of the geophysical and ancillary equipment was carried out by Aerodat. The survey aircraft was flown at a mean terrain clearance of 60 metres. Equipment Electromagnetic System The electromagnetic system was an Aerodat 3-frequency system. Two vertical coaxial coil pairs were operated at 935 Hz and 4600 Hz and a horizontal coplanar coil pair at 4175 Hz. The transmitter-receiver separation was 7 metres. Inphase and quadrature signals were measured simultaneously for the 3 frequencies with a time constant of 0.1 seconds. The electromagnetic bird was towed 30 metres below the transmitter. VLF-EM System The VLF system was a Herz Totem 2A. This instrument mea sures the total field and quadrature components of two selected transmitters, preferably oriented at right angles to one another. The sensor was towed in a bird 12 metres below the helicopter. The transmitting stations monitored were NSS, Annapolis, Maryland broadcasting at 21.4kHz for the 'Line 1 station and NAA, Cutler, Maine broadcasting at 24.0 khz for the "Ortho' station. Magnetometer The magnetometer employed a Scintrex Model VIW H8 cesium, optically pumped magnetometer sensor. The sensi tivity of this instrument was 0.1 nanoteslas at a 0.2

17 second sampling rate. The sensor was towed in a bird 12 metres below the helicopter. Magnetic Base Station An IFG proton precession magnetometer was operated.at the base of operations to record diurnal variations of the earth's magnetic field. The clock of the base station was synchronized with that of the airborne system to facilitate later correlation. Radar Altimeter A Hoffman HRA-100 radar altimeter was used to record terrain clearance. The output from the instrument is a linear function of altitude for maximum accuracy. Tracking Camera An Aerodat videosystem was used to the record flight path on VHS videotape. Fiducial numbers for cross-reference to the analog and digital data were recorded on the videotape, Analog Recorder An RMS dot-matrix recorder was used to display the data during the survey. In addition to manual and time fiducials, the following data were recorded: Channel Input Scale 01 Low Frequency Inphase 2 ppm/mm 02 Low Frequency Quadrature 2 ppm/mm 03 High Frequency Inphase 2 ppm/mm 04 High Frequency Quadrature 2 ppm/mm 05 Mid Frequency Inphase 8 ppm/mm 06 Mid Frequency Quadrature 8 ppm/mm

18 07 VLF-EM Total Field, Line 08 VLF-EM Quadrature, Line 09 VLF-EM Total Field, Ortho 10 VLF-EM Quadrature, Ortho 00 Altimeter (150 ra at top of chart) 13 Magnetometer, noise 14 Magnetometer, fine 15 Magnetometer, coarse 2.5%/mm 2.5%/mm 2.5%/mm 2.5%/mm 3 m/mm 0.1 nt/mm 2.5 nt/mm 25 nt/mm Digital Recorder A DAC/NAV II data system recorded the survey on magnetic tape. Information recorded was as follows: Equipment Recording Interval EM system 0.1 seconds VLF-EM 0.5 seconds Magnetometer 0.2 seconds Altimeter 0.5 seconds NAV System 0.5 seconds Radar Positioning System A Motorola Mini-Ranger (MRS III) radar navigation system was used for both navigation and flight path recovery. Transponders sited at fixed locations were interrogated several times per second and the ranges from these points to the helicopter measured to a high degree of accuracy. A navigational computer triangulates the position of the helicopter and provides the pilot with navigation information. The range/range data was recorded on magnetic tape for subsequent flight path determination.

19 CERTIFICATE OF QUALIFICATIONS I, GEORGE PODOLSKY, certify that: I am registered as of Ontario and work I reside at Ontario. a Professional Engineer in the as a Professional Geophysicist. Province 172 Dunwoody Drive in the town of Oakville, I hold a B. Se. in Engineering Physics from Queen's University, having graduated in I have been continuously engaged in both professional and managerial roles in the minerals industry in Canada and abroad for the past thirty two years. I have been an active member of the Society of Exploration Geophysicists since 1960 and hold memberships on other pro fessional societies involved in the minerals extraction and exploration industry. The accompanying report was prepared from information published by government agencies; materials supplied by Falconbridge Limited; from a review of any available proprietary geological and geophysical surveys and reports and from discussions, if any, held with other geologists and geophysicists who have worked on the property. I have worked extensively throughout the area including some work on an adjacent property, but have never visited this property. I have no interest, direct or indirect, in the property de scribed nor do I hold securities in Falconbridge Ltd. I hereby consent to the use of this report in a Statement of Material Facts of the Company and for the preparation of a prospectus for submission to the Ontario Securities Commission and/or other regulatory authorities. Oakville, Ontario March 9, 1987 Podolsky, y. Eng, GEOPOD ASSOCIATES INC.

20 Ontario natural Resources Report of Work (Geophysical, Geological, Geochemical and Expenditures) :7 li, Type ot sur^t*s) Airborne Geophysical Survey, MAG, VLF, and EM Claim Holder!*) Kidd Creek Mines Ltd. m The Mini 42A14SW0eei PROSSER 900 Address 571 Moneta Avenue, P.O. Box 1140, Timmins, Ontario, P4N 7H9 Survey Company Aerodat Ltd. l ownsnip or Area Prosser Township Date of Survey (fro; n Si to) , 87 Day Mo. Yr. Day l Mo. Yr. Prospector's Licence No. T Total Miles of line Cut Name and Address of Author (of Geo-Technical report) Robert D. Stewart, 571 Moneta Avenue, P.O. Box 1140, Timmins, Ontario, P4N 7H9 Credits Requested per Each Claim in Columns at right Special Provisions Geophysical Days per Claim For first survey: - Electromagnetic Enter 40 days. (This includes line cutting) - Magnetometer Mining Claims Traversed (List in numerical sequence) For each additional survey: using the same grid: Enter 20 days (for each) - Radiometric - Other Geological Man Days Complete reverse side and enter total (s) here Geochemical Geophysical - Electromagnetic - Magnetometer Days per Claim * Radiometric - Other Geological Airborne Credits Note: Special provisions credits do not apply to Airborne Surveys. Geochemical ^ Electromagnetic L\ ^ Magnetometer Days per Claim m 40 Radiometric Expenditures (excludes power stripping) Type ot Work Performed Performed on Claimls) Calculation of Expenditure Days Credits Total Expenditures Total Days Credits Instructions Total Days Credits may be apportioned at the claim holder's choice. Enter number of days credits per claim selected in columns at right. Total number of mining claims covered by this report of work. Date 21-JAN-87 Recorded Holder or Agent (Signature) Data Approved as Recorded Certification Verifying Report of Work l hereby certify that l have a personal and intimate knowledge of the facts set forth in the Report of Work annexed h^reto^kaving performed the work or witnessed same during and/or after its completion and the annexed report is true. Name and Postal Address of Person Certifying Rob ert D. steuart, P.p. Box-4M(h-S^ Au^ -4- Timmins, Ontario, P4N 7H9 Certified,.- -Jan-87 Certified by (Signature)

21 *f^ gjjegj^gj^^^^f^ msmmms mm ^^^AiiiSfe'iU P^i^^^6T(^g^^^^rggt ^i^inesfe^mi^^iisiiii^s^ l f l^ ^^Y**u^lf.*2Av i^tf&^c C- ' -r j'y^jj^v-- V -? UP*V.*s-. -W?t ^^^VH./!.^^.. -.'i.*.'i4ib.**;^-.': -.^".-.viv-.-siw'^)^; " 'w^-'ti.iip-* 'ikjkj*; ^?;^#?-^'if^' -Rfr*!' i^pi: 1*J '?^)^^v?ts'. *mirt5^^.f DISPOSITION OF CROWN LANDS " ^^^.'^ '^^^:^5^ji'^ ^^sj^^ -ffipffitjfc^i7*wl?ite.';t-.r '^^i^j^^^^^w^' L -" ^'-t-v^ a*rvk^docum6nt^^8ms^^ ^^ww ^T^^-t: l&lkiil^ ^i^^^s^r^^t^^lm^^ ^^^^^^P^^ ID^^ ui^^^iftute'riii'^^^s^izsse^^ ^^^'"VW": * ^^^^ ^rj^^ ^^K /: ^-^SI^^'-^^IW'&W^ " ^ ^Hl nivi*i *.**,IH^T.*^T:^*,*^.*WW^^-J *"^ i n^-r. i-i ^fii.v^.f m^pp v tp i- ieia^vesteovin^obto^at^xtenti^br'^h^pubuo^ *'a' it*r i -**.mb\ h W-rf^.'"m A' Jv A *n^j*'--jm*. Vi ih^j^ l - i,.^**^**'--;*.,1.!^.**.*.*.* ig^g^.^/iiuij POWNSHyi '^^../ :v : ^^^f^^,^^:^??^i^.sgstfi^rt. ii^fe^; ^K* P^iSft ',* *" J-^JI i h l" '' ^^;j*0f ) ^f^,^"v.wrap l^jfl^ll^p^ 'i,- -* '-frr\'-'^- - w.-'fcfjiittjibiav.*v.**:v*"*ji\2i*ia*jptj t'*'ar;*c-s7'*i s^'.^w ^v*^''j^vij^^iw;i*'*i'i^^'.v.i:3a.'-'7(",i*i* ;jrv -. v isvnw* 1-"***!!' ^^ Ht'wJtiii^-'T''-; 42A14S*M PROSSER v^^^^^^-j^^'-^^^^-^^s^ ^M^^S^^i^;^^^ ' ' ' ' -*. - * i -,.- - t - - "f -**r.. -t--fl.# iaf a,,, ^K A^*.- ^t ^"^ ovrt.-d(*.- 1-:LHTl;ip*t'-^*^ '-1* ~:^V"-V'. (5J rl '"^^, J ^JT*JTi?' '5 '

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